Are You Comfortable With Your Retirement Savings?

Are You Comfortable With Your Retirement Savings?

Do you know how much you need for retirement? If you’ve done the calculations, chances are you’re more confident in your ability to meet your retirement savings goals than someone who hasn’t.

This comes from the Insured Retirement Institute (IRI), a not-for-profit organization considered to be the authoritative source on annuities. The IRI recently released statistics on retirement confidence, and the results are telling.

According to the IRI, 44 percent of baby boomers who have calculated how much they’ll need to get through retirement are extremely or very confident in their ability to meet their retirement savings goals, compared to 29 percent of those who haven’t. The IRI data also suggests that owning an annuity increases confidence in the likelihood of a financially secure retirement; the IRI found that 53 percent of baby boomers who own an annuity are extremely or very confident. Only 31 percent of boomers who do not own an annuity felt the same.

Working with a financial advisor also significantly upped peoples’ expectations of a comfortable retirement, according to the IRI. Forty-three percent of baby boomers who consulted with advisors are extremely or very confident, compared to 32 percent of those who did not.

Annuities provide you with the ability to accumulate assets for retirement on a tax-deferred basis, and they provide you with a guaranteed monthly income stream on retirement. However, many different annuities exist to meet the specific needs of each investor. As the ICI data suggests, it’s a good idea to work with an advisor if you’re considering an annuity.


Annuities Remain Compelling to Many Investors

The latest statistics from the Insured Retirement Institute (IRI) are in, and they tell us that the annuity industry is holding its own, with signposts pointing towards a positive future.

Demand will remain high

The not-for-profit industry group reports that the demand for annuities will remain high because of four primary factors: The population is aging, people are living longer, the markets have been volatile, and investors want guaranteed income.

Additionally, annuities serve an important purpose, and annuity owners are more confident about their retirement, the IRI points out.

That said, there are many challenges in the industry and, as with many investment vehicles, the headwinds impacting annuities are primarily economic. For example, interest rates are historically low, and that has required annuity insurers to lower crediting rates on fixed annuities. As well, there are regulatory challenges and difficulties arising from the cost of capital in providing annuities.

Because of these economic factors, total sales of annuities have declined from $231.1 billion in 2011 to $211.8 billion in 2012, the latest annual data available. Of that $211.8 billion, $203.6 billion was attributable to deferred annuities and $8.2 billion to immediate annuities. Sales of fixed annuities (those that offer guaranteed, stable income streams) were worth $66.8 billion.

Despite this, IRI research indicates that future investors will continue to look for safety in their retirement investment products in 2013. Respondents to the most recent IRI study suggests that they will continue to seek retirement products that provide “guaranteed income each month” and “will not lose principal.”

If you’re one of those investors, you may want to ask your advisor about an annuity. As IRI study respondents indicate, safety is paramount. Annuities provide you with the ability to accumulate assets for retirement on a tax-deferred basis, and in retirement, they provide you with a guaranteed monthly income stream.

Recipe: Arroz Con Pollo for a Crowd

Serves 10

  • 8 cups chicken stock
  • 6 chicken breasts
  • 3/4 cup vegetable oil
  • 2 finely chopped onions
  • 3 cloves minced garlic
  • 3 cups seeded, chopped tomatoes
  • 2 grated carrots
  • 2 tbl red wine vinegar
  • 1/8 cup tomato paste
  • 2 tsp achiote powder
  • 2 tsp dried oregano
  • 3 tsp salt
  • 1 tsp pepper
  • 5 cups long grain white rice
  • 1 cup canned or cooked peas
  • 1/2 cup stuffed olives
  • Chopped cilantro and lime wedges

Directions

Bring the stock and chicken breasts to a boil. Reduce heat and simmer for 10 minutes. Turn off heat and let sit for 10-15 minutes. Remove chicken and leave to cool.

Add water to chicken stock to make 10 cups. Set aside. In a large pot, heat oil, garlic and onion until soft and translucent.

Add next nine ingredients. Stir until blended.

Add liquid. Bring to a boil over medium heat. Simmer until water evaporates. Cook at low heat, covered, for 25 minutes.

Shred chicken. Add to rice. Stir in peas and olives. Sprinkle with cilantro. Serve with lime wedges.


 

November 20th, 2014 by Lightship Insurance